Wilbur Ross to Sell Remaining 5.5% Stake in Bank of Ireland
Wilbur Ross, the U.S. billionaire investor in struggling industries, is selling his remaining shares in Bank of Ireland Plc after almost tripling his investment in less than three years.
The 1.8 billion shares are being sold for 26.5 euro cents each, seven percent less than yesterday’s closing price of 28.4 cents, according to a person with knowledge of the transaction who asked not to be identified because they weren’t authorized to speak publicly. At that price, the sale of the 5.5 percent stake will raise about 477 million euros ($648.7 million).
“This has been a hugely successful trade for Ross, effectively trebling his money only three years after correctly calling the bottom of the cycle,” said Philip O’Sullivan, an economist at Investec Plc in Dublin, which has an “add” rating on the stock. “In recent times, Ross has been investing in the Greek recovery, so this sale will free up funds to invest in opportunities in that and other markets.”
Ross’s WL Ross & Co., Fairfax Financial Holdings Ltd. and three other investors paid 1.1 billion euros, or 10 cents a share, for a 34.9 percent stake in Bank of Ireland (BKIR), the country’s largest by assets, in 2011. The accord helped the Dublin-based bank avoid state control as its bad loans soared in the wake of a real-estate collapse. Ross and Fairfax sold about 2 billion shares in the bank in March at 32.8 cents each.
The shares fell 4.9 percent to 27 euro cents as of 8:10 a.m. in Dublin trading.
WL Ross & Co., is selling the shares as “we were getting too much concentration” in banking investments after they gained value, Ross said in an e-mailed response to questions. He said he will resign from the bank’s board.
Bank of Ireland Chairman Archie Kane, in a statement, thanked Ross “for his contribution, diligence and commitment as a board member,” and said he was “instrumental in the success of the 2011 capital raising.”
Fairfax Financial Chairman and Chief Executive Officer Prem Watsa said in an e-mailed statement that his company “will continue to hold our shares of the bank for the long term.”
Bank of Ireland returned to profit in the first quarter for the first time since 2008 as impaired loans fell and lending margins rose, it said on April 25.
Shareholders in Europe, the Middle East and Africa have raised $70 billion from secondary share sales this year, compared with $49 billion raised in the same period last year as investors return to the region on the promise of an economic recovery, according to data compiled by Bloomberg.
Deutsche Bank AG managed the sale.
(An earlier version of this story corrected the year in which Ross bought the shares.)
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